I think your quote is from the link below, which has some more info.
"A cash-settled equity derivative is settled by the exchange of cash rather than the exchange of the underlying shares. It is common in the case of a cash-settled equity derivative for the writer of the derivative to hedge its position by acquiring the underlying shares, but there is usually no obligation to do so."
http://www.addisonslawyers.com.au/knowledge/Laying_Your_Cards_on_the_Table_–_Equity_Derivative_Positions_in_Australia_Exposed_by_Crown_and_Echo_Entertainment_-_Do_You_Need_to_Disclose_Your_Equity_Derivative_Holdings327.aspx
My quick review suggest the derivative might be counted if there was a 'control transaction', which i think means takeover attempt, so there might be implications if he goes over 20% in total.
Im guessing that they are rights to buy or it would be misleading to total it up to 17.9%, but in theory in such a significant position he might be trying to protect himself from downside risk.
(EDIT: i see you just posted the link)
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I think your quote is from the link below, which has some more...
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